Hundreds of jobs will be lost after the Daw Mill colliery announced it would close as a result of the UK's worst coal-mine fire in 30 years.

The last remaining mine in the Warwickshire coalfields will shut after 47 years of production, making most of its 650 staff redundant.

The fire, which broke out on 22 February at a depth of 540m, 8km from the end of the main shaft, continues to burn "ferociously" after 16 days and shows no sign of stopping, said its owner, UK Coal.

The fire is the latest in a series of problems which have dogged the mine and left the company reeling, prompting a major restructuring programme.

"This has been a terrible week, not just for the company and its employees but also for the energy security of the country," said UK Coal's chief executive, Kevin McCullough.

"Having successfully completed the restructuring, and being only weeks away from returning to healthy production, this ferocious fire has dealt a blow to everything we have tried to achieve over the last 12 months."

He said the company is exploring the possibility of transferring some staff to other mines.